First Time Home Buyer Article 10 of 10, Offer Was Accepted, Now What?

Posted on | November 13, 2009 | Written by: Diane Donnelly

Ok, I was chastised for failing to blog in the middle of a series of articles about buying your first home. My apologies go out to my loyal readers! The first time home buyer credit was absolutely keeping us swamped! So, anyway, I’m back and ready to get back to writing!

Congratulations! The seller accepted your offer. Now you are ready to go to closing (also called escrow) in some neck of the woods. Not so fast. This is where you and your agent get busy!

Before we jump into the “Now What”?, I want to quickly touch base on the three possible outcomes of the offer that you make to the seller.

The offer could be accepted as written.
The offer could be completely rejected.
The offer could be countered which means the seller wants to keep the negotiations open, but didn’t accept your offer as written.

If the offer was accepted, Congratulations! If the offer was rejected or countered, the offer that you wrote is now dead. It was not accepted and you are free to move to another home. However, if you want to renegotiate, that option is open to you as well.

For this writing, we are going to assume the offer was signed and you are moving in the direction of closing on your new home!!!!

This is a very exciting time! As I tell my buyer’s and seller’s, it is not yet time to celebrate. Things can come up and challenges can be faced. Here are some of the things that can come up.

1. Hopefully your agent has suggested you do a home inspection. I don’t care what kind of market you are in, Do a Home Inspection! The home inspection results range from no issues to RUN - DO NOT WALK AWAY FROM THIS HOUSE - RUN!!! If you are not satisfied with the results of the home inspection, depending on how the offer was written, you may have an option to get out of the contract. Be sure to fully understand the options available to you should the home inspection reveal deficiencies you are not happy with.

2. The seller’s circumstances could change and they may default on the contract. Legal? No. Does it happen? Yes, but rarely.

3. Your financing could fall through. Work with an experienced Realtor and Loan Officer and this will be avoided at all costs. Mortgage programs change day to day, but a well versed Realtor and Loan Officer will guide you in the right direction.

4. The appraisal could come in low. In a declining market, it could happen. Hopefully the Listing Agent and the Selling Agent (your agent) have pulled comparables and are able to justify the selling price. Sometimes, the Appraiser sees the value differently. If the value comes in low, the contract can be renegotiated, but the banks or lending institutes will not lend you more than what the appraiser tells them the house is worth.

Now that I have gotten you excited for a potentially tumultous experience, I want to emphasis that these are things that CAN come up, but with the right preparation WILL NOT come up.

Step by step:

The offer was written and accepted.
You turn your ratified contract in to your Loan Officer so he can begin processing your final loan.
The Loan Officer will order title work and set up closing from the title company of your choosing.
He or she will order the appraisal.
Your Realtor will schedule the home inspection and any other inspections you chose to do, (usually within 7 days) but your contract will stipulate a timeline.
If required, your Realtor and Loan Officer work together to order a Termite Inspection.
All of your inspections get completed and you and your Realtor work together to determine what, if any, repairs need to be addressed. These get negotiated with the sellers.
The appraisal comes back and is at value! Congratulations!
You and the seller agree to remedy the requested repairs! Congratulations!
Your Loan Officer received a loan approval from underwriting and has received a “Clear to Close”.
You go to closing, or escrow, and the deed gets signed, along with about 65,000 papers (OK, that is an exaggeration, but it is a whole bunch of paper).
You and the seller shake hands and you are now a homeowner!!!!! Congratulations!!!

Of course, the above is intended to illustrate one example of a home purchase process….. There are deviations to this, but again, a seasoned Realtor and Loan Officer are imperative to a successful outcome!

I hope you found this series to be of value to you and you are more educated now on how to purchase your first home. I am available to you should you have any questions or just want to run something by me.

If you found this series to be helpful to you, please forward it to a friend who may be interested in buying his first home. It is such a wonderful experience and such a rewarding experience for me as a Realtor!

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